General Insurance Definitions

  1. Accidental Death Coverage

    Accidental death coverage is sometimes a part of your auto insurance policy’s Personal Injury Protection (PIP), or may be offered as a separate Accidental death and Dismemberment Program.

  2. Actual Cash Value

    Your car’s actual cash value is calculated by determining its original value, minus the amount your car has depreciated since you bought it.

  3. Adjuster

    An adjuster is the person who investigates and settles auto insurance claims.

  4. Agent / Broker

    Agents and brokers both sell and manage insurance for their customers.

  5. Anti-Theft Recovery System

    By installing an anti-theft recovery system, you may be eligible for an auto insurance discount.

  6. Bodily Injury Liability Coverage

    Bodily injury liability coverage protects you if you are held responsible for injuring someone in a car accident.

  7. Claim

    A claim is a request to be reimbursed for a loss.

  8. Collision Coverage

    Collision coverage helps pay for auto repair, replacement costs, or cash in lieu of repairs, if your car hits another vehicle/object, or if your car rolls over.

  9. Commuting

    If you primarily use your car for commuting, this means that you mainly use the car to drive to and from work or school.

  10. Comprehensive Coverage

    Comprehensive coverage helps pay for damage to your car resulting from fire, certain natural disasters, falling objects and vandalism.

  11. Continuously Insured

    The length of time you’ve been continuously insured is the number of years you have been covered by one or more insurance companies without a lapse in your auto insurance coverage.

  12. Deductible

    A deductible is the amount of damages you agree to pay for if you file an auto insurance claim.

  13. Declarations

    The declarations page of your insurance policy summarizes the factual information essential to your insurance coverage.

  14. Defensive Driver & Driver Improvement Courses

    In certain states, you may qualify for an auto insurance discount if you’re in the eligible age range and if you’ve taken one of these courses.

  15. Depreciation

    Depreciation is the decline in an object’s value due to age, wear and tear or obsolescence.

  16. Full Coverage Auto Insurance

    Full coverage auto insurance denotes an insurance policy containing all auto insurance coverage legally required in a given state.

  17. Funeral Benefits

    If a covered individual dies from accident-related injuries, this auto insurance coverage pays for a portion of funeral expenses, regardless of who is at fault in an accident.

  18. Garaging Location

    The garaging location is where your insured car is parked most of the time.

  19. Hybrid Electric Vehicles

    Hybrid Electric Vehicles are powered by a combination of battery and fuel.

  20. Homeowner’s Insurance

    If your car is vandalized or stolen, it should be reported to your auto insurance company; however, items stolen from your vehicle are usually covered under your homeowner’s insurance

  21. Income Loss

    Income loss coverage protects you if you are unable to work due to accident-related injuries.

  22. Indemnity

    An indemnity is a pre-determined sum paid for a covered loss.

  23. Insurance Score

    Insurance scores are based on analytical models that objectively measure the relative likelihood of future insurance losses based on your credit history.

  24. Judgment

    A judgment is a final decision rendered by a court of law.

  25. Liability

    Liability coverage protects you from having to deplete your assets to pay for damages if you are held responsible for injuries or damages arising from an accident.

  26. Limits

    Limits are the maximum amount an insurance company will pay for a covered loss.

  27. Medical Payments Coverage

    This insurance coverage pays medical bills and/or funeral expenses if a covered driver and/or accompanying passengers are injured or killed while in an insured vehicle, regardless of fault in an accident.

  28. Motor Vehicle Report

    A Motor Vehicle Report (MVR) provides information on your driving record.

  29. National Credit File

    The National Credit File provides objective consumer information regarding the financial history of an individual.

  30. No-Fault Insurance

    If a type of auto insurance coverage is describe as no-fault, this generally refers to the way the insurance company settles a covered auto insurance claim.

  31. No-Fault States

    In some states, called no-fault states, insurance companies are legally required to pay a policyholder’s covered losses, regardless of who is held responsible for an accident.

  32. Non-Passive Alarm

    A non-passive alarm has to be manually activated every time you leave the car. You may qualify for an auto insurance discount if your car is equipped with such an alarm.

  33. Passive Alarm

    Passive alarms are automatically activated and emit warning sounds when someone tries to get into your car or home. You may receive an insurance discount if your car or home is outfitted with such an alarm.

  34. Personal Injury Protection

    Personal Injury Protection, or PIP, is a kind of auto insurance coverage available only in certain states, where it is often mandatory.

  35. Pleasure Use

    If you use your car for pleasure, this means that you typically drive it for fun, with no regular commuting or business use.

  36. Policy Expiration Date

    Your insurance policy’s expiration date is the date when auto insurance coverage ends if your insurance policy isn’t renewed.

  37. Policy Term

    A policy term is the length of time an insurance policy is valid.

  38. Primary Driver

    The primary driver is the person who drives the car most frequently.

  39. Primary Use

    A vehicle’s primary use is how the car is typically used.

  40. Property Damage Liability Coverage

    Property damage liability coverage protects you is you are held responsible for damaging someone else’s property in a car accident.

  41. Rental Car Reimbursement

    Rental car reimbursement is an optional kind of auto insurance coverage that helps pay for your rental car expenses if an insured car is damaged, or stolen, and you need a rental car.

  42. SR-22

    An SR-22 is an official document that shows proof of financial responsibility.

  43. Secondary Driver

    A secondary driver is one of the drivers listed on your auto insurance policy who’s insured for driving an insured vehicle.

  44. Steering Restraint

    A steering restraint is a durable collar, or shield, fitted to the upper and lower casing of your car’s steering column.

  45. Tort

    Tort is a legal term used to describe instances when someone is deemed legally responsible for injuring another person, or damaging his/her property.

  46. Towing Coverage

    This type of auto insurance coverage is optional, and pays a fixed amount toward towing if your car breaks down, or if it is disabled in an accident.

  47. Workers Compensation

    This is a mandatory coverage for workers in the State of Washington. It is designed to pay for lost wage, the injury treatment, and rehabilitation and may pay indemnity for a permanent loss of function or ability.

  48. Underinsured Motorist Bodily Injury (UIM) Coverage

    This type of auto insurance coverage pays for your medical expenses, lost wage, and other damages when you, or your passengers, are injured in an accident caused by a driver who has insufficient auto coverage.

  49. Underinsured Motorist Property Damage Coverage

    This type of auto insurance coverage protects you if your car is damaged in an accident caused by a driver who has insufficient auto insurance coverage.

  50. Uninsured Motorist Bodily Injury Coverage

    This kind of auto insurance coverage pays for medical expenses, lost wages, and other general damages when you, or your passengers, are injured in an accident caused by a driver who has no car insurance.

  51. Uninsured Motorist Property Damage Coverage

    This kind of auto coverage protects you if your vehicle is damaged in an accident caused by a driver who has no car insurance.